MISSISSIPPI LEGISLATURE

1997 Regular Session

To: Insurance

By: Representative Stevens

AN ACT TO REQUIRE THAT ENTITIES THAT PROVIDE STAFF, PERSONNEL OR EMPLOYEES TO OTHER BUSINESSES UNDER A LEASE ARRANGEMENT OR AGREEMENT SHALL REGISTER WITH THE COMMISSIONER OF INSURANCE BEFORE BECOMING ELIGIBLE TO BE ISSUED A POLICY OF WORKERS' COMPENSATION INSURANCE; TO PROVIDE REQUIREMENTS OF THE REGISTRATION; TO PROVIDE PENALTIES; AND FOR RELATED PURPOSES. 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. (1) A corporation, partnership, sole proprietorship or other business entity that provides staff, personnel or employees to be employed in this state to other businesses under a lease arrangement or agreement, before becoming eligible to be issued a policy of workers' compensation insurance or becoming eligible to secure coverage on a multiple coordinated policies basis, shall register with the Commissioner of Insurance. The registration shall:

(a) Identify the name of the lessor;

(b) Identify the address of the principal place of business of the lessor and the address of each office it maintains within this state;

(c) Include the lessor's taxpayer or employer identification number;

(d) Include a list by jurisdiction of each and every name that the lessor has operated under in the preceding five (5) years including any alternative names and names of predecessors and, if known, successor business entities;

(e) Include a list of each and every person or entity who owns a five percent (5%) or greater interest in the employee leasing business at the time of application and a list of each and every person who formerly owned a five percent (5%) or greater interest in the employee leasing company or its predecessors, successors or alter egos in the preceding five (5) years; and

(f) Include a list of each and every cancellation or nonrenewal of workers' compensation insurance that has been issued to the lessor or any predecessor in the preceding five (5) years. The list shall include the policy or certificate number, name of insurer or other provider of coverage, date of cancellation and reason for cancellation. If coverage has not been cancelled or nonrenewed, the registration shall include a sworn affidavit signed by the chief executive officer of the lessor attesting to that fact.

(2) Any lessor of employees whose workers' compensation insurance has been terminated within the past five (5) years in any jurisdiction due to a determination that an employee leasing arrangement was being utilized to avoid premium otherwise payable by lessees shall be ineligible to register with the Commissioner of Insurance or to remain registered, if previously registered.

(3) Persons filing registration statements under this section shall notify the Commissioner of Insurance as to any changes in any information provided in accordance with this section.

(4) The Commissioner of Insurance shall maintain a list of those lessors of employees who are satisfactorily registered with the commissioner.

(5) The Commissioner of Insurance may prescribe such forms as are necessary to promote the efficient administration of this section.

(6) Any lessor of employees that was doing business in this state before the enactment of this section shall register with the Commissioner of Insurance within thirty (30) days of the effective date of this section.

(7) Persons filing registration statements under this section may designate information directly affecting their business as "confidential" and such designated information shall not be released except by court order from a court of competent jurisdiction.

SECTION 2. No organization registered under this act shall directly or indirectly reference such registration in any advertisements, marketing material or publications.

SECTION 3. Any corporation, partnership, sole proprietorship or other form of business entity and any officer, director, general partner, agent, representative or employee of any of these entities who knowingly utilizes or participates in any employee leasing agreement, arrangement or mechanism for the purpose of depriving one (1) or more insurers of premium otherwise properly payable shall be subject, upon conviction, to a fine of not to exceed One Thousand Dollars ($1,000.00), in the case of a natural person, and Five Thousand Dollars ($5,000.00), in the case of an organization, or imprisonment for not over six (6) months, or both.

SECTION 4. This act shall take effect and be in force from and after July 1, 1997.